Cyprus Passes Tough Financial Bailout Package

A Cypriot left-wing supporter sits in the shade during a protest outside the Parliament in Nicosia on Tuesday.

Patrick Baz
/ AFP/Getty Images

Originally published on April 30, 2013 2:25 pm

Lawmakers in Cyprus approved a controversial $13 billion bailout from international lenders that's aimed at keeping the country from a messy default and withdrawal from the eurozone.

The agreement, which totals $30 billion when Cyprus' own contributions are included, passed 29-27 in the 56-seat Parliament.

The ruling center-right Democratic Rally party and its ally, the Democratic party, voted for the measure.

"If there was another realistic alternative, our decision would surely be different. Unfortunately, we have no other choice," Democratic party leader Marios Garoyian was quoted as saying by The Associated Press.

"The bailout comes at a steep cost: The government must implement punishing austerity measures, shut down the country's second-largest bank and impose losses of up to 60 percent on deposits over $130,000 held at the island's biggest financial institution, Bank of Cyprus.

" 'A yes from Cyprus' Parliament is by far the biggest defeat in our 8,000-year history,' independent lawmaker George Perdikis said ahead of the vote. 'Its democratically elected representatives have a gun to their head to agree to a deal of enslavement.'

"Ahead of the vote, the communist AKEL party, which held the presidency until early this year, said Cyprus should start looking beyond Europe for financial support.

" 'Cyprus' only option is a solution outside the loan agreement,' the party said in a statement ahead of Tuesday's debate. 'Seeking such a solution is possibly tantamount to a decision to exit the euro.' "